1. And the Marketing Mix (4p’s)

2. Marketing:
The activities required to provide a product or service to satisfy a customer's needs or wants

3. Target Market
All the characteristics of the market segment (customers) that you are selling to.

4. Marketing Mix Target Market Product
What product(s) or service(s) should we sell?
How should product/service be branded?
What is the best positioning?
Price
What are the pricing objectives?
How much should we charge?
Product
Price
Target
Market
Marketers have essentially four variables to use when crafting a marketing strategy and writing a marketing plan. They are price, promotion, product and distribution (also called placement). They are sometimes referred to as the four Ps. A marketing mix is a combining of these four variables in a way that will meet or exceed organizational objectives. A separate marketing mix is usually crafted for each product offering. When constructing the mix, marketers must always be thinking of who their target market are. Mix coherency refers to how well the components of the mix blend together. A strategy of selling expensive luxury products in discount stores has poor coherency between distribution and product offering.
Promotion
What value does our product add for consumers?
What is the best way for us to convey our message to consumers?
Place
Promotion
Place
Where, when and how will consumers access products?
How will we distribute? 4

5. (4ps)
4 Ps

6. Marketing Mix (4 P’s)
PRODUCT/SERVICE – the actual product, (design, colour, materials, taste, scent) or service the company sells.

7. Marketing Mix (4 P’s)
PLACE (CHANNELS OF DISTRIBUTION) - the methods of how goods or services are distributed to and reach the consumer (Ex. transportation and stores).

8. Marketing Mix (4 P’s) PRICE – how much it costs to make?
variable and fixed costs
desired profit

9. Marketing Mix (4 P’s) Promotion –
increase awareness to potential customers
convince customers the product/service is better than anyone else’s (competitors).
Branding

10. (4ps) Product
Product/Service Planning – the process through which a businesses makes decisions about the features needed to sell their products, service or ideas.

11. Product Mix
Includes all the different products that a company makes or sells.
What company makes these products?

13. Developing Existing Products
Line Extensions – new product lines, items, or services
Original Product
Newer Products

14. Developing Existing Products
Product Modifications – an alteration in a company’s existing product

15. Deleting a Product or Product Line
Obsolescence
Loss of appeal
Replacement with new products
Lack of profit

16. PRODUCT PACKAGING Protect preserve product
Safety for product/ consumer
convenience factors for retailer and consumer
Product labeling- safety and use instructions
Universal Product Code (UPC)
Product promotion – the silent seller

17. (4ps) Place Distribution
The paths of ownership that goods follow as they pass from the producer to the consumer
In other words….
How a product gets from the producer to the customer.

18. Wholesalers
the selling of goods in large quantities to be retailed by others.

19. Retailers
A business or person that Sells goods/ services to the customer (as opposed to wholesaler or distributor)

20. Specialty Channels
Any indirect channel of distribution that do not involve a retail store.
Ex: distributors, Vending machines, internet, catalogues, TV

21. Modes of Transportation
Trains
Trucks
Planes
Ships
Pipeline

22. Direct Distribution Direct link between the producer and the consumer
Direct distribution is more common than it used to be. Why?
Producer Consumer

23. Indirect Distribution
Intermediaries take possession of the goods, add a mark-up, and then resell them to consumers.
Importers/ manufacturers
Wholesalers
Retailers
Consumer

24. Indirect Direct Manufacturer Manufacturer Wholesaler Retailer Consumer

25. Which do you think works better?
(4ps) Price?
Pricing is one of the 4Ps of the marketing mix:
The price of the product or service affects
How much demand there will be
How much you will sell
How consumers will view your product
How much competition you will have
* * Price too high, risk not selling
* * Price too low, risk not selling
Which do you think works better?

26. Discount Pricing Selling products at a reduced price Cash
2% off if you pay bill early OR coupon on box
Get more in terms of quantity
If the Bay buys 10,000 Diesel t-shirts they’ll get them cheaper
Seasonal discounts
Christmas cards and off-season vacations
Promotional discounts and allowances
Rebates and trade-in old merchandise

27. Guess the price !

28. Guess the price ! $17.93 $3.49 $19.99 $18.83 $17.89 $1490.00 $6.96
$179.00
$20.00

29. Imagine you want to buy some chocolate. Which of these will you buy
Imagine you want to buy some chocolate. Which of these will you buy? Move to the corner of the room that matches your choice. Discuss why you chose that product.
Broken chocolate bar pieces from the bulk food store.
Price: $1 for about 2 bars
Toblerone bars.
Price: $6.99 for a large “gift size” bar.
GODIVA chocolates – considered by many to be “the best”
Price: $20 for a small box of about 12 chocolates
Widely available chocolate bars.
Price: $1 each

30. Imagine you are going to buy a car. Which of these will you buy
Imagine you are going to buy a car. Which of these will you buy? Move to the corner of the room that matches your choice. Discuss why you chose that product.
Lamborghini Gallardo – often mentioned in rap songs.
Price: $250,000
Audi TT – a cool design featured in several movies.
Price: $60,000
A sporty and economical new Toyota Echo
Price: $15,000
1983 used Datsun
Price: $600

31. Imagine you are going to buy ketchup. Which of these will you buy
Imagine you are going to buy ketchup. Which of these will you buy? Move to the corner of the room that matches your choice. Discuss why you chose that product.
Annie’s Organic Ketchup Price: $5.00
Great Value Price: $2.00
Heinz Ketchup Price: $4.27
Hunt’s Ketchup Price: $2.99

32. What influences a price?
Convenience
Status and image (positioning)
Trends
Competition
Quality
Cost to make and sell it
How much the target customer will spend for it
Profit that a company wants to make
How much a company wants to sell
How quickly they want/need to sell
Others?
Pricing is one of the 4Ps of the marketing mix:
The price of the product or service affects
How much demand there will be
How much you will sell
How consumers will view your product
How much competition you will have
* * Price too high, risk not selling
* * Price too low, risk not selling

33. COMPETITIVE PRICING Examples: VS. Our lowest price guarantee
Benchmark pricing (p.264)
Our lowest price guarantee
The lowest price is the law

34. COST-ORIENTED PRICING
Price = cost of making product/service + all other expenses (fixed and variable) + desired profit

35. The cost of doing business
Variable Costs
Expenses that change depending on the level of production or sales.
e.g. raw materials, employee wages, sales commissions, shipping costs, etc.
Other examples?
Fixed costs
Expenses that stay the same regardless of how much is produced or sold.
e.g. Rent, phone bill, heating, insurance, etc.
Other examples?
Fixed costs are also called overhead.
Variable costs are also called direct costs.
The price of goods/service must cover all the costs and make a surplus (profit) on top.
To cover fixed costs it makes a good deal of difference whether you sell one item or 100. Since the entire fixed costs have to be recovered regardless of the number of sales.
Total costs = fixed costs + variable costs

36. Psychological Pricing
Refers to techniques that create an illusion or impression for customers that make them buy

37. Psychological Pricing Techniques
Odd-even pricing $2.99 or $100
Odd numbers convey bargain!
Even numbers convey quality
Prestige Pricing expensive $1000+ Rolex watches
Conveys status
You’ll look rich or cool

38. Psychological Pricing Techniques
Multiple Unit pricing 4 chocolate bars in a pkg
You think you’re getting a bargain
Increases sales volume
Bundle Pricing shampoo and conditioner bundle
Price is lower than if you bought separately
Getting a bargain

39. Psychological Pricing Techniques
Promotional Pricing
Loss leaders – sell products at cost or below to get customers in to the store
Prices reduced for a certain time, ie. at holidays
Everyday Low Prices (ELDP)
Low prices every day with no intention of raising them or offering more discounts

40. (4ps) Promotion
Branding is establishing an identity for a product that differentiates it from the competition.
It is made up of a brand name, logo, slogan, and trademark and creates brand loyalty.
What is branding?

41. Brand Name
A brand name is the letters, words or numbers that can be verbalized
Guess the Logo Font

42. Types of Brands
A National Brand is a product which is branded by a manufacturer's brand and is typically supported by heavy advertising.
Coca Cola and Heinz Ketchup would be examples of this.

43. Types of Brands
A private Brand or “Store Brand” label is a brand that a retailer creates to exploit their corporate image
Only that retailer can sell it
It allows them to differentiate themselves (And control price and quality)
Examples:
Loblaw’s “President’s Choice”
Shopper’s Drug Mart’s “Life” brand
HBC’s “togo” brand

44. Types of Brands
Generic Brands or “No Name Brands” The lowest cost because the labeling and packaging is cheaper
There is no promotion for this type of brand.

45. LOGO
A logo is the part of the brand in the form of a symbol that is usually registered
A brand mark and trademark are examples of a logo

46. SLOGAN
A slogan is a catchy phrase used to remind the consumer of a company or brand
Harvey’s makes a hamburger a beautiful thing”

47. What is it?

48. Target Market
All the characteristics of the market segment (customers) that you are selling to.

49. Demographics Age range Income range Gender Marital status
Number of Children
Occupation
Geographic Location

50. Psychographics Attitudes Opinions Interests Lifestyle
Needs to be filled
What or who influences the purchase decision
How will find out about your product

51. PROMOTION TECHNIQUES ADVERTISING:
ex. ads on Web, TV, radio, newspaper, magazines, smart phones, flyers, junk mail.
SALES PROMOTION:
ex. sales coupons, free gifts or samples, games of chance, demonstrations.

52. PROMOTION TECHNIQUES PUBLICITY: ex. news report - free advertising.
PRODUCT PACKAGING:
ex. The container/wrapping in which the product is sold in.

53. PROMOTION TECHNIQUES
Personal Selling – one on one communication to persuade a customer to buy
AIDA Selling formula, the four steps
Attract attention
Hold interest
Arouse desire
Take action to close the sale